EU and India Sign Historic Trade and Defence Pact EU President Ursula von der Leyen and Indian Prime Minister Narendra Modi concluded the largest trade agreement ever signed by the European Union and India in New Delhi on 27 January 2026. The accord removes or cuts tariffs on about 90% of trade, promises up to €4 billion in tax savings for EU exporters and could double EU exports to India over time. It also establishes the first defence partnership, including joint naval exercises against piracy and the protection of vital sea routes. The deal is portrayed as a model of diversification and resilience in an increasingly fragmented global order. The agreement follows EU‑Mercosur talks signed in Paraguay a month earlier and is positioned as a key step for the EU’s strategic independence without resorting to protectionism. It offers European farmers lower tariffs on wine and olive oil and protects standards for meat and sugar. Economists say the pact could boost the EU’s trade volume with India, which accounts for €180 billion in annual trade and employs about 800,000 people in the EU. The agreement underscores the EU’s willingness to cooperate with emerging powers rather than isolate itself, and the first defence collaboration signals a new era of security ties beyond traditional NATO or European frameworks.

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